Big Tech's remote work U-turn: so is working from home good or not?

Remote work spread fast during the pandemic. It was hailed as “the future of work!”, but that didn’t last. Now that COVID has been behind us for a while, the GAFAM companies, which were supposed to be remote work’s biggest champions, have all started announcing RTO (return to office). These are the same companies that sold the very tools that powered remote work, like Office 365 and Google Meet. Flipping on it all at once? What a betrayal, lol.

But what’s the real story here? Should companies push ahead with remote work, or pull back from it?

This time, I’ll dig into that question from a slightly sideways angle.

Why remote work spread during the pandemic

Remote work took off, of course, as a COVID measure. Part of it was pure necessity, since people couldn’t commute. But it was also adopted quickly because it promised companies and employees benefits like these:

Higher productivity: less time spent commuting, more efficient online meetings, and flexible ways of working.

A wider talent pool: making use of people living outside the big cities, people raising children or caring for family, and freelancers.

Lower costs: savings on office rent, commuting allowances and business travel.

The Japanese government backed it too, under its banner of “promoting DX (digital transformation).” In Japan as well, remote work took root, especially at large companies.[1]

Big Tech’s post-pandemic return to office

But wait, here comes the twist. GAFAM has suddenly been pushing hard on RTO. Amazon, Google, Meta and others have swung sharply away from remote work, with policies ranging from “mandatory office attendance three days a week” to “full-time in the office recommended.”[2] The main reasons they give are these:

Face-to-face communication: the claim that meeting in person is better for creativity and productivity.

Preserving company culture: in-person work is said to be essential, especially for training new hires and building culture.

Fixing pay inequity: correcting the sense of unfairness when employees keep big-city salaries while living outside the big cities.

But are those really the only reasons? GAFAM praised remote work to the skies, and now this sudden reversal. I can’t shake the feeling that something else is going on.

Does remote work really boost productivity?

In truth, opinions are divided on whether remote work raises or lowers productivity across a company as a whole.[3][4]

Individual benefits, like cutting commute time, are obvious. But put simply: if remote work had produced an overwhelming jump in productivity, GAFAM would have accelerated remote work, not reversed it. RTO makes a lot more sense if you assume GAFAM concluded that, at the macro level of the whole company, productivity doesn’t change much, or even drops.

GAFAM are companies that make “data-driven” decisions. Isn’t it quite likely they have data that casts remote work in a negative light? Of course, it will probably never be made public…

Is RTO a loyalty test? A way to tighten control over employees?

There’s also a reason behind the RTO shift that rarely gets said out loud: the intent to “take back control over employees.”

As remote work spread during the pandemic, it got easier to take on side jobs or switch employers, and employee loyalty to companies dropped. Many workers found they could work without depending on a single company, and the flow of information and people between competitors picked up.

As a result, in the AI industry for example, we’re seeing more and more cases where similar products, like “AI agents” or “Deep Research,” are announced almost at the same time.[5]

Of course, the movement of people between companies, and the risk of information leaking, also depend on whether the job market favors workers or employers. But there’s little doubt that remote work sped that movement up even further.

RTO is also about tighter management, and not only of information. It also helps companies control working hours and see how work is progressing. With remote work, it’s hard to know how much employees are actually working or how they’re getting things done, and the burden of managing them grew. Bringing people back to the office puts them where the boss can see them, which is thought to make work more transparent.

Seen against that background, it’s possible that GAFAM holds up “face-to-face communication” and “preserving company culture” as the official reasons, while in reality pushing RTO to strengthen its control over employees. In other words, RTO may partly be a kind of fumie, a loyalty test. (A fumie was an image of Christ or the Virgin Mary that people in Edo-period Japan were made to step on to prove they weren’t Christians.)

What comes next

So what happens from here? And how should Japanese companies respond to this trend?

This is a safe, middle-of-the-road answer, but the move toward hybrid work (mixing office days and remote days) won’t stop completely. How far it goes, though, will likely depend on the industry and the type of job.

At the same time, GAFAM’s moves show that managing remote work is far from easy, and getting the expected benefits from it isn’t simple either. Remote work has real advantages, but it also carries risks, and both workers and companies should keep that in mind.

Having remote work as an option is never a loss for workers. So in a job market that favors workers, we should see more companies pushing remote work and putting hiring first.

But given how firmly GAFAM has gone all-in on RTO (return to office), it seems likely that they, at least, don’t expect a workers’ market to come back any time soon. Whether that’s because they overhired during the pandemic, or because they think AI progress will make people unnecessary, I can’t say…

Either way, for a company that puts hiring first with an eye on the future, promoting remote work should be an important option. On the other hand, there’s also the path of doing the opposite, the way GAFAM has.

So watching GAFAM’s moves closely looks like it can give the rest of us some important hints.

…By the way, owls apparently have eyesight about ten times sharper than humans. Then again, the “watching” I mean here has nothing to do with eyesight (lol).

References

[1] https://www.mlit.go.jp/report/press/content/001598357.pdf (in Japanese)

[2] https://www.itmedia.co.jp/business/articles/2409/27/news055.html (in Japanese)

[3] https://dhbr.diamond.jp/articles/-/11214 (in Japanese)

[4] https://news.yahoo.co.jp/articles/a0b11fc37d53d64844d198f069f11800a93e4b3c (in Japanese)

[5] https://www.watch.impress.co.jp/docs/topic/1668760.html (in Japanese)